Multiple Choice
According to the Ricardian equivalence theorem, people increase savings today when the government increases deficits because they recognize that:
A) government deficits imply higher future taxes.
B) government deficits imply lower future taxes.
C) consumption reduces future taxes.
D) consumption increases future taxes.
Correct Answer:
Verified
Correct Answer:
Verified
Q73: As the economy contracts, tax revenues:<br>A)fall and
Q74: The crowding out effect would be lower
Q75: Functional finance is:<br>A)based on empirical evidence that
Q76: If state governments began using a five-year
Q77: When the government runs a deficit, the
Q79: If income increases, a budget deficit will:<br>A)tend
Q80: If the economy falls into a recession,
Q81: Refer to the graph shown. Assume the
Q82: Using fiscal policy to stabilize the economy
Q83: If interest rates adjust to equate savings